From devices to experiences: ecosystem partnerships drive sustainable growth in MEA’s consumer tech market

As the MEA consumer tech market shifts from hardware to services, propelling media and entertainment spending toward a projected $36bn by 2027, ecosystem partnerships are emerging as the critical framework powering this growth. In this blog, Omdia explores how vendors, telcos, and retailers are becoming indispensable partners for service providers, enabling the bundled subscription models that are reshaping the region's value chain from one-off device sales to long-term, recurring revenue.

Hardware remains the bedrock of the Middle East and Africa (MEA) consumer tech ecosystem. Smartphones and PCs are the anchors through which users connect, stream, play, and transact. However, according to Omdia, while hardware revenues are projected to rise from $32.9 billion in 2020 to ~$41.9 billion by 2027, services and subscriptions are advancing faster. Media and entertainment spending - covering OTT, music, and gaming - is expected to nearly double in the same period, from $18 billion to $36 billion

Globally, services revenue already outpaces device sales in some markets - for example, media and entertainment spend in Western Europe exceeds consumer device sales. MEA is not there yet, but the trajectory is clear. In GCC markets, telco ARPU of $20+ (vs <$5 in much of Africa) creates room to bundle - but also raises expectations. Yet MEA attracts just 14% of global telco-OTT partnerships as of 2Q25, despite its mobile-first user base. At the same time, 63% of these partnerships are already mobile-led, among the highest globally, showing consumers are accustomed to subscriptions processed via telcos.

Ecosystem partnerships leading the shift to experiences: In affluent markets such as Saudi Arabia and the UAE, vendors are running out of natural growth catalysts.

Differentiation through form factor or display quality no longer sustains momentum. To break through, vendors are repositioning devices as “experience platforms” powered by services.

Take Samsung’s foldables: when bundled with Netflix or Shahid by Etisalat or STC, the device is no longer just another phone. It becomes a cinematic gateway, marketed around experience, not specs. For first-time foldable buyers, such partnerships showcase functionality and spark imagination. For entertainment providers, cementing content with new device categories as habits form is an unmissable opportunity.

• Etisalat and STC package Galaxy and iPhone flagships with Netflix, OSN+, and StarzPlay.
• Noon has experimented with IPL streaming in UAE and KSA.
• Anghami Plus is bundled with Huawei and OPPO promotions, while StarzPlay now attracts ~60% of new customers through telco tie-ups.
• Operators in the UAE, Kuwait and Qatar push “family bundles” combining connectivity, streaming, and device insurance.

Who pays for these bundles varies. In telco-led deals, operators usually bear most of the cost, though terms depend on the power balance with the app provider and may include “breakage fees” if activation targets aren’t met. In vendor-led offers, such as Xiaomi or Samsung giving 60–90 day trials of YouTube Premium or Spotify, the vendor typically funds it as a marketing expense, with service providers offering discounted wholesale rates. Regardless of the model, the outcome is the same: telcos defend stickiness, vendors differentiate, and service providers gain reach.

The central role of telcos and retailers: Telcos and retailers are the enablers. Their incentive is clear: defend ARPU and cut churn by locking users into layered bundles. In the UAE, most premium buyers already take OTT or music subscriptions through their telco, underlining how deeply content is tied to device purchases. 

For operators, bundles are margin-friendly in high-ARPU markets. A Galaxy S25 Ultra plan with Netflix, Anghami Plus, and iCloud storage ties the customer far longer than a SIM-only plan. For retailers like Sharaf DG or Noon, embedding streaming, device care, or cloud upsells expands basket size and positions them as ecosystem gateways. 

For consumers, bundles lower total cost of ownership versus buying services separately, while reducing friction. Convenience, cultural relevance, and value remain decisive.

The risks of over-subsidization: MEA’s competitive market means most bundles start with subsidies - from free TWS, to 6-month StarzPlay or Anghami trials, to fitness app access. Etisalat frequently offers OTT bundles free for 3 to 6 months, while retailers like Noon attach “free IPL subscription included” tags. However, these conditions lead users to view services as giveaways rather than essentials. Without a transition, subsidy-driven bundles risk a downward spiral. According to Omdia, the online video market in MENA is set to grow more than fivefold, reaching US$8.4 billion by 2029. Capturing that opportunity will require bundles to evolve into profitable, recurring subscriptions that consumers are willing to pay for - whether in health, AIoT, or insurance.

Partnership imperatives for the MEA: By 2027, devices in the MEA are expected to generate ~$42 billion in revenue. But the bigger story is services: media and entertainment alone will nearly match that at $36 billion. The question is not whether partnerships matter, but how fast players align to capture recurring value.

• Vendors: shift marketing from specs to experiences (foldables × Netflix, premium phones × gaming, wearables × fitness).
• Telcos: expand bundles beyond ultra-premium to mid-tier, particularly in Egypt and North Africa.
• Retailers: need to shift from seeing themselves as hardware traders to becoming part of the broader service ecosystem and revenue stream. Unlike telcos, they lack a natural link to services through data plans, but they can still partner with streaming and software providers to monetize their sales touchpoints.
• Content providers: prioritize telco and vendor distribution. Direct-to-consumer in MEA is costly and fragmented; bundled distribution is the fastest route to scale.

MEA sits at a turning point. Hardware will remain the anchor, but its ability to drive growth alone remains sluggish. According to Omdia, the MENA streaming market will hit US$1.5 billion in 2025, with subscriptions surpassing 27 million. Yet penetration is fragmented - Netflix, for example, trails regional champions like Shahid, underscoring the importance of vendor and telco partnerships for scale. These partnerships are a win-win: vendors gain differentiation, telcos defend ARPU, and service providers secure distribution. If bundles remain subsidy-driven, MEA risks margin erosion. But if aligned into subscription-anchored ecosystems, every device sold can become a recurring revenue stream, monetized across its lifecycle.

Join us at “In Conversation with Omdia at GITEX 2025”

Services and subscriptions are becoming the new growth engine for Middle East consumer tech, reshaping how vendors, telcos, retailers, and content providers create value. At our upcoming event, Omdia analysts will dive deeper into ecosystem partnerships, share real-world examples, and outline strategies for building sustainable, service-led business models.

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